Roo Hsing Co (如興), one of the world’s largest denim jeans manufacturers, on Tuesday announced plans to acquire a controlling stake in New York-based Nanjing USA Inc, an apparel manufacturer and distributor supplying major retailers in the US.
The Taiwanese company intends to purchase a 52.8 percent stake in the Florida-headquartered company for US$48 million to expand its global reach.
Nanjing USA sells more than 25 million pairs of jeans annually, and its retail partners include Target Corp, Walmart Inc and Costco Wholesale Corp, Roo Hsing said in a filing with the Taiwan Stock Exchange.
Roo Hsing is hoping to tap into retailers’ demand for branded, licensed and private label products by learning from its investee, it said.
Given continuing trade tensions between the US and China, the acquisition should help the company diversify its production bases, it said.
It also hopes to yield new synergistic gains by complementing Nanjing USA’s relations with US retailers with its expertise in product design, procurement and quality assurance, it said.
Roo Hsing’s revenue rose 76.54 percent year-on-year to NT$17.45 billion (US$566 million) last year, but the company reported a net loss of NT$115 million in the first nine months of last year.
The company also announced that a remaining payment of US$63.4 million that is part of its controversial US$380 million acquisition of Chinese apparel maker JD United Holdings Co (玖地集團) in 2017 has been waived.
The sum was owed to Sun Yang (孫瑒), a major JD United shareholder who is also Roo Hsing’s president.
Sun had waived the payment to support Roo Hsing’s growth prospects following its acquisition of Nanjing USA, the company said, adding that since its takeover, JD United’s operations have been improved by automation systems.
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